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I can't help but think that Facebook doomed this "distributed ledger" possibility by trying to be first to market with a tarnished brand. The developing world

I can't help but think that Facebook doomed this "distributed ledger" possibility by trying to be first to market with a tarnished brand. The developing world would hugely benefit from a scalable technology that can efficiently service digital transactions. The piece demonstrates this with how quickly WeChat Pay and Alipay penetrated China. I can't imagine the possibility for prosperity when 3 billion consumers enter the global economy in a matter of years. Alternative currencies were always going to have to compete (or at least deal with) with powerful governments, and all the most powerful governments are most easily manipulated by appealing to a mass audience. The Facebook brand isn't capable of doing that right now. There's far more incentive for politicians to talk about breaking Facebook up than to encourage Facebook to embed itself in the financial lives of their constituents. If a decision is made to breakup Facebook, spinning off Libra will be right at the top of the list. I can't see how it survives as a stand-alone technology without the support of Facebook's network effects.

cflewis 7y ago
I was thinking the same thing. Either the product managers or the PR people are tone deaf (or why not both?). I once saw a PR person talk about how you had to earn your way to allow yourself to be part of certain larger societal conversations. Start at grass roots, earn trust there, step up to communities, earn trust there, step up to local governments etc etc. Being big doesn't earn you anything out the gate. I liked this idea. However charitably you think about Facebook, I don't think you could possibly surmise that Facebook has earned its way to the conversation of its stated aims of helping people who can't get credit cards use digital currency. I think Libra would have been marketed much better if it had been a separate company with FB taking a 51% controlling stake, and these other validators making up the rest.
- drcode 7y ago
  I think the real PR disaster will come when FB tries to "square the circle" and explains exactly how they are gonna keep people's Libra transactions fully isolated through the Colibra foundation while simultaneously allowing every FB app to have a built-in Libra wallet... I can't wait to hear the mental gymnastics that will be required to continue to uphold that claim.
- JumpCrisscross 7y ago
  > the product managers or the PR people are tone deaf Evidence points to a massive lack of co-ordination with this launch. Government relations (together with the relevant House and Senate committees) learned about the launch from the news briefing. This whole thing appears to be a shambling mess, born out of desperation more than ingenuity.
kabwj 7y ago
The developing world doesn’t care about the reputation Facebook has on HN.
- JumpCrisscross 7y ago
  > The developing world doesn’t care about the reputation Facebook has on HN The developed world does: "based on an analysis of SimilarWeb Android data, Jefferies analyst Brent Thill found daily average users for core Facebook have declined in the U.S., U.K., Germany and France over the last 12 months—although he notes sequential user growth across geographies in April and May. In the U.S., time spent on core Facebook and its photo-and-video-sharing platform Instagram also has declined over the last 12 months, with users spending sequentially less time on both apps most recently" [1]. Antagonism to Facebook not a niche issue. Autocracies won't cede power to Zuckerberg. Poor democracies have no incentive to sign up to a cartel without rich countries' wealth. Without at least some OECD support, the project is DOA. [1] https://www.wsj.com/articles/facebooks-pricey-ad-spend-may-not-impress-11561460400?mod=hp_major_pos18 https://www.wsj.com/articles/facebooks-pricey-ad-spend-may-n...
  - kabwj 7y ago
    Libra is not for the developed world; I didn’t mention the developed world in my message. It remains to be seen what it will happen to it in the developing world, but the reputation of Facebook won’t be an obstacle.
    - Apocryphon 7y ago
      Internet.org has had a mixed record there.
  - adventured 7y ago
    > Poor democracies have no incentive to sign up to a cartel without rich countries' wealth Of course they do. The cartel will easily bribe them - whichever politicians need incentivized - to leave the door open. They don't require much of an opening. Visa is now worth more than every US or global bank - such as JP Morgan, HSBC or Bank of America - and worth more than twice what the largest tech company in Europe (SAP) is worth. Mastercard is worth 70% more than SAP. These types of massive companies can trivially grease any and all wheels to embed themselves deeper into the global economy. What else do companies like Visa and Mastercard have to spend their extreme brand-bullshit margins on? If you're those guys, the only thing worth directing your flood of endless high margin profit at is to get locked deeper into the global economy. They can afford to purchase infinite lubrication for all practical purposes. Take Visa as an example. They have 50% net income margins - laughably extreme - because they have absolutely nothing else to do with their business other than collect the cash as it rolls in, and then look at ways to ensure their parasite position is perpetual and continues to expand.
camgunz 7y ago
> The developing world would hugely benefit from a scalable technology that can efficiently service digital transactions. The piece demonstrates this with how quickly WeChat Pay and Alipay penetrated China. I hear this a lot in cryptocurrency threads, and I vehemently disagree. There's no doubt that using "some other currency" (currency or cryptocurrency) is better than using a corrupt, authoritarian regime's currency. But there's also no doubt that being able to execute monetary policy is a huge advantage for any country. Read anything about currency manipulation or currency markets. Not being able to control the supply of currency your goods (or others' goods, i.e. petrodollars) are valued in is a huge disadvantage. It feels like there's a huge political push to try and get the "developing world" (with all the hand-waving that's been applied to this term) onto cryptocurrencies, but that permanently puts them at a disadvantage compared to countries that can manipulate their own currency. I think selling this is short-term-ism at its worst. And honestly? It's also vaguely colonial. I would love to hear from people in these countries what they think about cryptocurrencies, if anything. Cryptocurrency advocates saying, "we know what's best for you" is super troubling to me.
- JumpCrisscross 7y ago
  > there's a huge political push to try and get the "developing world" (with all the hand-waving that's been applied to this term) onto cryptocurrencies, Is there? There's a lot of discussion around it. But I've never seen a legitimate push.
- Shaddox 7y ago
  I fully agree with you. I'd also like to add something that I consider the elephant in the room. Haven't tech companies already proven themselves that they're willing to bend to governments' will in order to do business? No authoritarian government will welcome Libra with open arms. If the currency won't bend to their will, then they will simply ban it and then it becomes (at best) a black market good. There's also another issue: how do you value it so that it becomes useful to everyone? If I'm in Venezuela getting paid in bolivars then my money already has no power to begin with. It will also be hard to manage for a lot of people. I doubt some average Joe in a poor country will want to complicate himself by buying something at 0.0000000231 Libra. It will require a lot of cognitive power to not get scammed.
foobardev 7y ago
China has WeChat & Alipay. India has PayTm & PhonePe (+others), the government also has a really good initiative called UPI. South East Asia has a bunch of similar apps as well. I think the developing world is ahead of US & EU in this regard, card & bank account usage is bound to decline in the long run.
scarface74 7y ago
The “tarnished brand” of Facebook is hugely overstated. Facebook is not losing users. Libra is already “spun off”. FB only owns a tiny share.
- MBCook 7y ago
  The fact that people are willing to trust FB with their personal photos or favorite political memes doesn’t mean they’re willing to trust them with money. And it doesn’t matter who controls Libra if everyone thinks of it as ‘the Facebook money thing’.
  - jpkiser 7y ago
    No, it doesn't matter if everyone thinks of it as 'the Facebook money thing' if that's not what it is. The only thing that people's perception effects is whether or not governments influenced by said perception allow Facebook to build a wallet in with their service in those regions. Libra the currency will be a thing regardless.
anbop 7y ago
Which consumer brand at this scale isn’t tarnished? Amazon? Google? Apple (not even applicable since they build only for their device users? Walmart? Bank of America?
- Apocryphon 7y ago
  Costco, Netflix, Chase. Microsoft appears to have a comeback by ducking out while the heat was on the other companies.
kreetx 7y ago
Although Facebook's brand is a bit tarnished then the general public doesn't look at it so negatively as we here. Compare it to, say, politics: plenty of corruption, yet we still have it around (and what would the alternative be?). Libra will probably be a success, perhaps even a huge one.

cflewis 7y ago

I was thinking the same thing. Either the product managers or the PR people are tone deaf (or why not both?). I once saw a PR person talk about how you had to earn your way to allow yourself to be part of certain larger societal conversations. Start at grass roots, earn trust there, step up to communities, earn trust there, step up to local governments etc etc. Being big doesn't earn you anything out the gate. I liked this idea. However charitably you think about Facebook, I don't think you could possibly surmise that Facebook has earned its way to the conversation of its stated aims of helping people who can't get credit cards use digital currency. I think Libra would have been marketed much better if it had been a separate company with FB taking a 51% controlling stake, and these other validators making up the rest.

drcode 7y ago
I think the real PR disaster will come when FB tries to "square the circle" and explains exactly how they are gonna keep people's Libra transactions fully isolated through the Colibra foundation while simultaneously allowing every FB app to have a built-in Libra wallet... I can't wait to hear the mental gymnastics that will be required to continue to uphold that claim.
JumpCrisscross 7y ago
> the product managers or the PR people are tone deaf Evidence points to a massive lack of co-ordination with this launch. Government relations (together with the relevant House and Senate committees) learned about the launch from the news briefing. This whole thing appears to be a shambling mess, born out of desperation more than ingenuity.

kabwj 7y ago

The developing world doesn’t care about the reputation Facebook has on HN.

JumpCrisscross 7y ago
> The developing world doesn’t care about the reputation Facebook has on HN The developed world does: "based on an analysis of SimilarWeb Android data, Jefferies analyst Brent Thill found daily average users for core Facebook have declined in the U.S., U.K., Germany and France over the last 12 months—although he notes sequential user growth across geographies in April and May. In the U.S., time spent on core Facebook and its photo-and-video-sharing platform Instagram also has declined over the last 12 months, with users spending sequentially less time on both apps most recently" [1]. Antagonism to Facebook not a niche issue. Autocracies won't cede power to Zuckerberg. Poor democracies have no incentive to sign up to a cartel without rich countries' wealth. Without at least some OECD support, the project is DOA. [1] https://www.wsj.com/articles/facebooks-pricey-ad-spend-may-not-impress-11561460400?mod=hp_major_pos18 https://www.wsj.com/articles/facebooks-pricey-ad-spend-may-n...
- kabwj 7y ago
  Libra is not for the developed world; I didn’t mention the developed world in my message. It remains to be seen what it will happen to it in the developing world, but the reputation of Facebook won’t be an obstacle.
  - Apocryphon 7y ago
    Internet.org has had a mixed record there.
- adventured 7y ago
  > Poor democracies have no incentive to sign up to a cartel without rich countries' wealth Of course they do. The cartel will easily bribe them - whichever politicians need incentivized - to leave the door open. They don't require much of an opening. Visa is now worth more than every US or global bank - such as JP Morgan, HSBC or Bank of America - and worth more than twice what the largest tech company in Europe (SAP) is worth. Mastercard is worth 70% more than SAP. These types of massive companies can trivially grease any and all wheels to embed themselves deeper into the global economy. What else do companies like Visa and Mastercard have to spend their extreme brand-bullshit margins on? If you're those guys, the only thing worth directing your flood of endless high margin profit at is to get locked deeper into the global economy. They can afford to purchase infinite lubrication for all practical purposes. Take Visa as an example. They have 50% net income margins - laughably extreme - because they have absolutely nothing else to do with their business other than collect the cash as it rolls in, and then look at ways to ensure their parasite position is perpetual and continues to expand.

camgunz 7y ago

> The developing world would hugely benefit from a scalable technology that can efficiently service digital transactions. The piece demonstrates this with how quickly WeChat Pay and Alipay penetrated China. I hear this a lot in cryptocurrency threads, and I vehemently disagree. There's no doubt that using "some other currency" (currency or cryptocurrency) is better than using a corrupt, authoritarian regime's currency. But there's also no doubt that being able to execute monetary policy is a huge advantage for any country. Read anything about currency manipulation or currency markets. Not being able to control the supply of currency your goods (or others' goods, i.e. petrodollars) are valued in is a huge disadvantage. It feels like there's a huge political push to try and get the "developing world" (with all the hand-waving that's been applied to this term) onto cryptocurrencies, but that permanently puts them at a disadvantage compared to countries that can manipulate their own currency. I think selling this is short-term-ism at its worst. And honestly? It's also vaguely colonial. I would love to hear from people in these countries what they think about cryptocurrencies, if anything. Cryptocurrency advocates saying, "we know what's best for you" is super troubling to me.

JumpCrisscross 7y ago
> there's a huge political push to try and get the "developing world" (with all the hand-waving that's been applied to this term) onto cryptocurrencies, Is there? There's a lot of discussion around it. But I've never seen a legitimate push.
Shaddox 7y ago
I fully agree with you. I'd also like to add something that I consider the elephant in the room. Haven't tech companies already proven themselves that they're willing to bend to governments' will in order to do business? No authoritarian government will welcome Libra with open arms. If the currency won't bend to their will, then they will simply ban it and then it becomes (at best) a black market good. There's also another issue: how do you value it so that it becomes useful to everyone? If I'm in Venezuela getting paid in bolivars then my money already has no power to begin with. It will also be hard to manage for a lot of people. I doubt some average Joe in a poor country will want to complicate himself by buying something at 0.0000000231 Libra. It will require a lot of cognitive power to not get scammed.

foobardev 7y ago

China has WeChat & Alipay. India has PayTm & PhonePe (+others), the government also has a really good initiative called UPI. South East Asia has a bunch of similar apps as well. I think the developing world is ahead of US & EU in this regard, card & bank account usage is bound to decline in the long run.

scarface74 7y ago

The “tarnished brand” of Facebook is hugely overstated. Facebook is not losing users. Libra is already “spun off”. FB only owns a tiny share.

MBCook 7y ago
The fact that people are willing to trust FB with their personal photos or favorite political memes doesn’t mean they’re willing to trust them with money. And it doesn’t matter who controls Libra if everyone thinks of it as ‘the Facebook money thing’.
- jpkiser 7y ago
  No, it doesn't matter if everyone thinks of it as 'the Facebook money thing' if that's not what it is. The only thing that people's perception effects is whether or not governments influenced by said perception allow Facebook to build a wallet in with their service in those regions. Libra the currency will be a thing regardless.

anbop 7y ago

Which consumer brand at this scale isn’t tarnished? Amazon? Google? Apple (not even applicable since they build only for their device users? Walmart? Bank of America?

Apocryphon 7y ago
Costco, Netflix, Chase. Microsoft appears to have a comeback by ducking out while the heat was on the other companies.

kreetx 7y ago

Although Facebook's brand is a bit tarnished then the general public doesn't look at it so negatively as we here. Compare it to, say, politics: plenty of corruption, yet we still have it around (and what would the alternative be?). Libra will probably be a success, perhaps even a huge one.